Question
A firm is considering purchasing two assets. Asset A will have a useful life of 15 years and cost $3 million; it will have installation
A firm is considering purchasing two assets. Asset A will have a useful life of 15 years and cost $3 million; it will have installation costs of $400,000 but no salvage or residual value. Asset B will have a useful life of 6 years and cost $1.26 million; it will have installation costs of $220,000 and no salvage value. Which asset will have a greater annual straight-line depreciation?
a. Asset A has $10,000 more in depreciation per year. | ||
b. Asset A has $20,000 more in depreciation per year. | ||
c. Asset B has $10,000 more in depreciation per year. | ||
d. Asset B has $20,000 more in depreciation per year. | ||
e. None of the above |
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